THE TAKEAWAY: [U.S. Initial Jobless Claims rose to 4-month high; Continuing Claims increased to 3,063,000] > [The growh of hiring shows some weakening] > [USDJPY Bearish]
Applications for unemployment insurance payments rose more than expected in the week ended March 30, to the highest level in four months. According to a report issued by Labor Department in Washington today, jobless claims increased by 28,000 to 385,000 unexpectedly, while initial claims from two week ago were held unchanged at 357,000 from initially reported. Economists polled by Bloomberg News had forecasted a rise to 353,000. Meanwhile, the continuing claims climbed to 3,063,000, exceeding the consensus forecast of 3,050,000.
The amount of Americans filled claims has climbed for three straight weeks, implying some slowdown in the job recovery after hiring accelerated in February. As Easter holiday falls on different weeks from year to year, the government has some difficulties to adjust the data. In addition, despite hiring is picking up, it is not strong enough to boost the entire labor market. Sustained improvement in employment is needed for US recovery as it helps spur consumer spending, which accounts for about 70 percent of the economy.
USDJPY 1-minute Chart: April 4, 2013
Chart created using Marketscope 2.0– Prepared by Renee Mu
In the minutes following the data release, the U.S. dollar dropped against its Japanese counterparty, with USDJPY falling to 95.27 yen. Yet as markets corrected, the greenback quickly pared most of its loss and rebound to the level before the data release. At the time of this report was written, the USDJPY was trading higher at 95.43 yen.
--- Written by Renee Mu DailyFX Research